Question 1159689: The following is a probability function used to depict the projected net income (in millions) in the coming year for ABC Limited:
Net Income (X) Probability (f(X))
-1.0 0.24
0 0.18
1 0.48
2.5 b
What is the probability that the company makes more than $2 million in the coming year? (1 mark)
What is the expected net income for ABC Limited, i.e., what is the expected value of this probability distribution? (2 marks)
What is the standard deviation of expected net income?
Answer by Boreal(15235)   (Show Source):
You can put this solution on YOUR website! b=0.10 needed to make the probability sum 1.0
E(X)=-0.24+0+0.48+.25=0.49 or $490.000
SD is the difference from the mean squared *probability, add them up and take square root
1.49^2*0.24+0.49^2*0.18+0.51^2*0.48+2.01^2*0.1
=1.1049
sqrt of that is 1.051 or $1,051,000
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